Election & Global Uncertainty Affecting Investors’ Stock Outlook

This week’s Sentiment Survey special question asked AAII members what factors are most influencing their six-month outlook for stocks. The top two factors were the U.S. presidential election (listed by 45% of respondents) and global economic uncertainty (named by 39%). More than one out of four respondents (27%) specifically pointed to the uncertainty being created by the vote in Britain to leave the European Union (Brexit). Nearly 17% of respondents cited prevailing valuations, with several describing them as being too high, while about 16% cited Federal Reserve policy and frustration with the still-low level of interest rates. Slightly more than 13% cited earnings, with several respondents saying growth is too slow. Many respondents listed more than one factor.

Here is a sampling of the responses:

“Uncertainty with this election cycle”

“Continued slow GDP and earnings growth”

“The agreed upon terms of the UK’s exit from membership in the EU”

“Stock valuations are at historical highs and this bull market is getting very old”